Abby L. Harvey
GHG Monitor
10/23/2015
The use of enhanced oil recovery (EOR) in the United Kingdom’s North Sea holds the promise of enabling the obtainment of up to 500 million additional barrels of otherwise unrecoverable oil. However, to harness this opportunity, action must be taken now to create a CO2-EOR industry, according to a new report published by The Energy Research Partnership. “The potential recoverable oil could decline from about 500 million barrels to 100 million barrels between 2025 and 2030 if no supply of CO2 is available,” the report says.
EOR has been a fairly common practice for decades in the United States where it is possible to collect CO2 from natural reserves and transported to depleted oil fields. An ongoing effort is underway in the U.S. to incorporate more anthropogenic CO2 in this process as well. While the U.S. has been able to develop an EOR industry using natural CO2 reserves, the U.K. does not have this option. “Unlike the U.S., the U.K. has no identified natural sources of CO2. Developing a sufficient supply of CO2 to meet the needs of the oil fields requires several carbon capture projects to be in operation by the early 2020s,” the report says.
The need for concurrent growth in the carbon capture and CO2-EOR industries in the U.K. presents several problems. “Any delays in developing CCS, Phases 1 and 2, will significantly reduce the CO2 -EOR opportunity, as most suitable oil fields are expected to cease production by 2030,” according to the report. Advancements in CCS have been slow to date with only two large-scale CCS projects in the U.K. showing significant progress, one of which recently lost a very large stakeholder.
Further, these CCS projects are located in a less than ideal location to foster a CO2-EOR industry, according to the report. “The most realistic U.K. location for CO2 -EOR is the Central North Sea (CNS). However, most CO2 is expected from power stations in North East England,” according to the report. For this reason, the development of a substantial CO2 pipeline network will be necessary.
The report makes four key recommendations for the development of a CO2-EOR industry in the U.K.’s North Sea. First, delivering CO2-EOR in the North Sea requires coordinating the different sectors and industries for the extraction of oil and the development of CCS and a CO2 transport network. To this end, the Oil and Gas Authority, the government’s Office for CCS and existing oil and gas operators will need to work together.
The report also recommends that policy decisions over the next two years be geared toward supporting the advancement of CCS. “Developing a CO2 supply in time to realise CO2 -EOR will be best achieved if both CCS Commercialisation projects under consideration by DECC are supported as early as possible, to build learning and confidence about CCS and ensure the CO2 supply infrastructure is in place,” the report says.
Incentivizing CO2-EOR in the offshore tax regime is also recommended, as is enabling the establishment of a CO2 transport network or infrastructure company.
